FOR THE EASTERN DISTRICT OF PENNSYLVANIA NATIONAL ... · Multistate Legal Studies, Inc. (known as...
Transcript of FOR THE EASTERN DISTRICT OF PENNSYLVANIA NATIONAL ... · Multistate Legal Studies, Inc. (known as...
IN THE UNITED STATES DISTRICT COURTFOR THE EASTERN DISTRICT OF PENNSYLVANIA
NATIONAL CONFERENCE OF :BAR EXAMINERS : CIVIL ACTION
:v. :
:MULTISTATE LEGAL STUDIES, INC., : NO. 04-03282-JFd/b/a PMBR, et al. :
ADJUDICATION
Fullam, Sr. J. August 22nd, 2006
This case, involving claims of copyright infringement
and violations of the California Business and Professions Code,
was tried non-jury on February 1, 2, 3 and 6, 2006. Counsel
submitted lengthy proposed findings of fact and conclusions of
law, accompanied by voluminous exhibits, and closing arguments
were held on April 10, 2006. My findings and conclusions are
summarized below.
Plaintiff, the National Conference of Bar Examiners
(“NCBE”), develops testing materials used by more than 50
jurisdictions to evaluate applicants seeking bar admission. The
most widely used of these products is the Multistate Bar
Examination (“MBE”), a 200-question multiple-choice test
administered in February and July each year. To pass the bar
exam in most jurisdictions, applicants must achieve a minimum
score on both the MBE and on a separate essay portion. The MBE
2
covers topics in contracts, criminal law and procedure,
constitutional law, real property, evidence, and torts. Each
question comprises a brief fact pattern, a lead-in asking the
test-taker about a particular legal issue, and four answer
choices. Drafting these questions is a lengthy process for which
NCBE retains panels of professors, judges, and practitioners.
Each MBE contains approximately 60 questions from earlier tests
to provide a basis for comparing the performance of applicants on
one MBE with that of previous groups. Using these data,
plaintiff corrects for variations in the degree of difficulty of
the examination when computing individual scores. Questions may
appear on several MBEs before being retired.
Because plaintiff reuses many MBE questions, it goes to
great lengths to maintain the secrecy of those questions. NCBE
submits the MBE to the Register of Copyrights under regulations
that exempt secure tests from the deposit requirement. 37 C.F.R.
§§ 202.20(b)(4), 202.20(c)(2)(vi); see also National Conference
of Bar Examiners v. Multistate Legal Studies, Inc., 692 F.2d 478
(7th Cir. 1982)(upholding the validity of regulations governing
registration of secure tests). It also takes steps to enforce
this copyright: prohibiting test-takers from discussing or
reproducing MBE questions, and resorting to legal action when bar
review courses violate these rules. See, e.g., National
3
Conference of Bar Examiners v. Saccuzzo, No. 03-CV-0737, 2003 WL
21467772 (S.D. Cal. Jun. 10, 2003). NCBE does release
approximately 1100 retired questions, which can be licenced for a
fee.
Defendants Robert Feinberg and Dona Zimmerman founded
Multistate Legal Studies, Inc. (known as the “Preliminary
Multistate Bar Review” or “PMBR”) in 1977 to sell MBE test-
preparation services. The company currently offers a variety of
programs: a 3-day class, a 6-day class, and a one-on-one
tutorial. These courses provide oral and written instructional
materials addressing the substantive law tested on the MBE, test-
taking strategies, and practice MBE questions. PMBR is both
popular and lucrative, teaching more than 40,000 students in 2004
(nearly 60% of those taking the MBE) and bringing in more than
$16,000,000 in gross revenues that year. In addition to being
the sole owners of PMBR, Mr. Feinberg and Ms. Zimmerman have
drawn millions of dollars in salary from the company.
The 3-day course, which is the focus of this
litigation, is given in approximately 100 locations before the
February administration of the MBE and 150 locations before the
July administration. The average cost to students, as estimated
by defendants’ expert, was $254.39 in 2001, $275.62 in 2002,
$277.34 in 2003, and $304.74 in 2004. On the first day of the
4
course, students take a full 200 question simulated MBE, referred
to as the “PMBE.” The remaining two days use the PMBE questions
to instruct students on substantive law and test-taking
techniques. Students also receive written answer keys to the
PMBE with detailed explanations and citations to the source
materials used to develop the questions. Before the inception of
this lawsuit, defendants incorporated approximately 50 new
questions into each year’s 200-question PMBE. Other course
materials were revised less frequently and less extensively. Mr.
Feinberg generates almost all of the PMBE questions and
explanatory answer keys himself, relying in part on hornbooks,
treatises, reporters, and published cases. He also admits that
he uses the notes of PMBR employees who have taken the MBE in
recent years. PMBR does not retain these notes or any other
development materials.
Many PMBR advertisements use “testimonials” from former
students emphasizing the similarity between PMBR practice
questions and those appearing on the MBE. Specifically touting
the 3-day course, one student praised the quality of PMBR’s
practice questions, noting that “dozens of nearly identical
questions appeared on the actual exam.” Ex. P255. Another
reported that he “breezed through the exam because [he]
recognized so many of the questions from PMBR.” Ex. P253. A
5
third reported that he was “already familiar with many of the
questions” before taking the MBE. Ex. P256. A fourth exclaimed
(in large boldface type) that “It Was Deja Vu All Over Again. I
Was Amazed How Similar The Actual MBE Was To PMBR!” Ex. P252.
Mr. Feinberg writes other promotional materials
himself. One PMBR brochure explains that:
PMBR questions cover issues which are consistently repeatedon the MBE. (PMBR develops its own questions. Some othercourses overplay the value of released questions. Sincereleased questions will never be repeated, you will neversee them on the MBE – so who needs ‘em?).
Ex. P298. Mr. Feinberg has told students in his 3-day course
that they can expect to “recognize many of these similar types of
questions on the actual exam,” Ex. P292, and pointed out
particular PMBE questions that were very similar to recent MBE
questions. Predictably, some of those questions are at issue in
this suit, e.g. 1544_RLP from the February 2003 MBE and 1327_TOR
which appeared on four MBEs from 1992 through 2003.
PMBR is able to expose students to “the latest, the
newest questions covering the newest distinctions that were
tested [on the MBE],” Ex. P287, because the company’s employees
sit for nearly every administration of the examination. After
completing the MBE, these employees take notes on the topics
covered, and in some instances on the specific facts of questions
or their answer choices. Mr. Feinberg has personally taken the
6
MBE more than 20 times, and Ms. Zimmerman more than a dozen.
Given that these individuals are highly paid to prepare students
to take (and presumably to pass) the bar exam, their failure rate
is strikingly high. Mr. Feinberg, for example, failed five
consecutive bar examinations in Alaska before barely passing in
February 2004. Once an applicant passes the bar in a given
jurisdiction, he may not take it there again. Perhaps even more
startling, Ms. Zimmerman twice failed the Kentucky Bar
Examination despite passing the essay portion, because her scores
on the MBE were so low. Her testimony that she failed because
the MBE “is quite a difficult examination” speaks poorly of
either her professional qualifications or her credibility as a
witness.
The events leading to this lawsuit began in Anchorage
in February 2003. At the time, Alaska was the only jurisdiction
that permitted the use of scratch paper during the MBE. Even so,
students were strictly prohibited from removing scratch paper or
other exam materials from the testing room. At the conclusion of
the afternoon MBE session, Mr. Feinberg broke this rule. As he
was leaving the room, a proctor noticed that he was carrying a
sheet of scratch paper with notes on it. She stopped him,
confiscated the paper, and filed an Irregularity Report with
NCBE. While the notes on the paper are brief and somewhat
7
cryptic, they clearly relate to topics and answer choices of
particular MBE questions. Upon receiving the Alaska Irregularity
Report in April 2003, NCBE undertook an extensive review of the
defendants’ course materials, comparing each PMBE question
published from 2001 onward to a database of MBE questions. After
concluding that more than 100 questions had likely been copied,
plaintiffs filed this lawsuit.
A plaintiff alleging copyright infringement must prove
both ownership of a valid copyright and copying of the original
elements of the protected work. See Feist Publications, Inc. v.
Rural Telephone Service Co., Inc., 499 U.S. 340, 361 (1991). As
I rejected defendants’ attempts to challenge NCBE’s copyright in
orders of April 13 and July 21, 2005, all that remains is the
question of copying. I find that plaintiff has proven copying
both with direct evidence and by demonstrating that there is
substantial similarity between the MBE and PMBE questions.
This is the rare case in which there is direct evidence
that defendants copied plaintiff’s work. See Rottlund Co. v.
Pinnacle Corp., 452 F.3d 726, 732 (8th Cir. 2006) (“Direct
evidence of copying is rarely available because it includes
evidence such as party admissions, witness accounts of the
physical act of copying, and common errors in the works of
plaintiffs and the defendants.”). Mr. Feinberg and other PMBR
1 To cite just one example, a PMBE question refers to “X-10gidgets,” while the MBE question from which it is copied involves“X10 widgets.” There could be no more trivial variation. Theirrelevant PMBE explanation that a “gidget is a syntheticreplication of a widget” confirms awareness of copying.
8
employees regularly write down information about the fact
patterns, prompts, and answer choices appearing on MBE
examinations that they have taken. Mr. Feinberg admitted that he
uses these notes when writing PMBE questions. In order to
facilitate this process, PMBR employees sought out the only
jurisdiction that allowed test-takers to use scratch paper,
taking (and in all but one case failing) the Alaska Bar Exam
eight times from 2001 through 2003. In February 2003, Mr.
Feinberg was caught leaving the examination room with his scratch
paper. In addition, PMBR advertisements brag about how close its
questions are to those on the actual MBE, and Mr. Feinberg has
made similar statements. Finally, many PMBE questions reproduce
MBE questions nearly verbatim, and others contain trivial
variations that suggest awareness of copying.1 See M. Kramer
Mfg. Co., Inc. v. Andrews, 783 F.2d 421, 446 (4th Cir. 1986). I
conclude that defendants willfully copied MBE questions, either
by setting out to do so, or engaging in behavior that was so
certain to lead to copying that intent must be inferred.
2 Only a handful of PMBE questions, such as those allegedlybased on MBE questions 1270_CNL, 1588_EVD, and 1886_EVD, do notnecessarily appear to be copied, either because the MBE questionsinvolve common legal principles presented in a very generalizedway or because the similar aspects relate only to the area of lawbeing tested, and not to specific facts or answer choices.
9
The substantial similarity between most of the
allegedly infringing PMBE questions and copyrighted MBE items
bolsters this conclusion. Because defendants do not dispute that
they had access to plaintiff’s copyrighted questions, plaintiff
will prevail if there is “sufficient similarity between the works
so as to conclude that the alleged infringer ‘copied’ the work,”
and the similarity relates to the protectable aspects of the
allegedly infringed work. Dam Things from Denmark v. Russ Berrie
& Co., 290 F.3d 548, 562 (3d Cir. 2002).
After reviewing each pair of MBE and allegedly-
infringing PMBE questions, I conclude that nearly all of the 113
challenged questions are substantially similar to copyrighted MBE
questions.2 In many instances, evidence of copying practically
leaps from the page. One such egregious example is based on
1792_CNL, which appeared on the July 1999 MBE:
As Part of the Federal Deficit Eradication Act, Congressimposed a special tax on “all interest in excess of 5% perannum earned by each state of the United States on any ofits investments.” This tax is probably
10
(A) constitutional, because it does not discriminate amongthe several states – it treats all of them in the samemanner.
(B) constitutional, because it taxes only a proprietary function ofthe states – it does not tax any of their strictly governmentalfunctions.
(C) unconstitutional, because it singles out state governments forspecial taxation that is not applicable to any other entities orindividuals.
(D) unconstitutional, because it requires a state government itselfto make a tax payment to the United States.
Answer key: C
Question #27 on the 2001 PMBE, repeated as question #142 on the
July 2004 PMBE, reproduced much of this question verbatim:
Congress has passed a new federal statute called the FederalDeficit Eradication Act. The law imposed a special tax onall interest in excess of 5% per annum earned by each stateon any investments made by the respective state(s)
The state of Texas has filed an appropriate action infederal district court challenging the constitutionality ofthe federal statute. In all likelihood the court will findthe Federal Deficit Eradication Act to be
(A) constitutional, because the law does not discriminateamong the several states
(B) constitutional, because the incidence of the tax is oninterest payments from outside investments and does notapply to government functions
(C) unconstitutional, because it places a discriminatoryburden on state governments
(D) unconstitutional, because the tax burden applies tostate governmental bodies and not the residents of thestate
3 Mr. Feinberg testified that he was “very surprised” atthe similarity between these two questions even though herecalled seeing the MBE question when taking the examination andwriting the PMBE question afterwards. Tr. 2/3/06 at 80-81.
11
Answer key: B
This question tests the same legal concept using the same
fictitious statute and four virtually identical answer choices in
the same order.3 As with a number of PMBE questions, the answer
key here is incorrect, further undermining Mr. Feinberg’s claims
that he derived his questions independently from authoritative
legal sources.
While many PMBE questions exhibit this degree of
similarity, less-than-wholesale reproduction can also provide a
sufficient basis to conclude that there was copying. See
Educational Testing Service v. Simon, 95 F. Supp. 2d 1081, 1088
(C.D. Cal. 1999)(“[I]mmaterial variations do not alter the
conclusion that infringing material is substantially similar to
copyrighted material.”). Question #120 on the 2002/2003 PMBE,
repeated as question #174 on the July 2004 PMBE and #20 on the
2005 PMBE, involves all of the same material facts as MBE
question 1672_TOR, which appeared in July of 2001. The MBE
question reads in relevant part:
Agent arranged a dinner meeting with Customer, a prospectivestockholder. During dinner, Agent made several false andmisleading statements to Customer regarding the financial
12
soundness of Company. Waiter, who was serving the tablenext to Agent and Customer, overheard the statements. Basedon those statements, Waiter purchased a substantial numberof shares of Company stock. Within weeks after Waiter’spurchase, Company filed for bankruptcy and Waiter lost hisentire investment. In a suit by Waiter against Agent torecover for his loss, will Waiter prevail?
(A) Yes, because Waiter reasonably relied on the statementsmade by Agent.
(B) Yes, because Agent should have foreseen that Waiterwould hear the false statements.
(C) No, because Agent was not attempting to induce Waiterto purchase any Company stock.
(D) No, because investing in newly issued stock is toospeculative.
Answer key: C
The PMBE question also involves a waiter who overhears fraudulent
insider information not intended for his ears, invests his money
based on this information, loses it, and sues the one who made
the statements. Two of the answer choices are also nearly
identical:
Bilko was an investment swindler who ran a Ponzi scheme. One evening he took a group of unwitting investors to dinnerhoping to convince them to invest in a new business venture. At the restaurant Bilko falsely told the gathering that hiscompany’s stock price would appreciate 200% within threemonths. Dupe, a waiter at the restaurant, overheard Bilko’spresentation and decided to invest in the enterprisehimself. Thereafter, Dupe invested $10,000, his entire lifesavings, in Bilko’s business venture. Two months laterBilko’s company became insolvent and filed for bankruptcy. If Dupe sues Bilko for fraud seeking to recover damages forhis investment loss, will he prevail?
13
(A) Yes, because Bilko should have been aware that otherpeople may have overheard his false statements.
(B) Yes, because Bilko provided false information which wasrelied on by Dupe.
(C) No, because Bilko did not intend to induce Dupe to actin reliance and invest in his investment scheme.
(D) No, because Bilko did not direct his statements to Dupewho happened to be eavesdropping on the conversation.
Answer key: C
While defendants included some original language and factual
embellishments, they clearly copied the question from the one
appearing on the MBE.
In all, defendants copied well over 100 PMBE questions
from the MBE, in many cases duplicating passages nearly verbatim
or reproducing labyrinthine fact patterns turn by turn.
Having determined that there was copying, I now turn to
whether the copied elements are subject to copyright protection.
MBE questions may reflect original expression in their wording,
particularized facts, and answer choices. Defendants argue that
they should be afforded only limited protection because they test
established legal rules within a relatively narrow set of formal
constraints. This is a fundamental misreading of Educational
Testing Services v. Katzman, 793 F.2d 533, 542 (3d Cir. 1986),
which recognized that there is protectable expression even in a
multiple choice question designed to test knowledge of basic
14
mathematical concepts, such as square roots and fractions. See
also Ass’n of Am. Med. Colls. v. Mikaelian, 471 F. Supp. 144, 150
(E.D. Pa. 1983). Teaching the legal principles tested on the MBE
is permissible. Doing so using the same fact patterns, prompts,
and answer-choice combinations found in MBE questions is not.
MBE questions based on published cases or newspaper
articles are protectable to the extent that they include material
alterations in the facts, new legal issues, or original answer
choices. For example, question 1033_CRM, which appeared on the
February 2001 MBE, drew on a 1993 New York Times article
reporting that a court clerk had been charged with murder after
smuggling a firearm into the courthouse for her boyfriend, who
used it to kill a police officer. See Joseph F. Sullivan, Clerk
Accused of Smuggling Gun in Courthouse Killing, N.Y. Times, June
5, 1993, at A11. Inspired by this article, the MBE drafters
developed a question designed to test the defenses of duress,
necessity, and insufficient mens rea. In so doing, they added
two key facts not appearing in the article: that the gunman told
the clerk that he wanted her to smuggle the gun so that his
probation officer would not discover it, and that he threatened
to kidnap her children if she refused to cooperate. The
question’s focus on the clerk’s best defense and the four
specific answer choices also reflect creative expression. A PMBE
15
question from 2003/2004 copied the additional facts, prompt, and
three of the same answer choices, all of which are protected by
plaintiff’s copyright.
In other instances, the creative expression is embodied
in the answer choices, rather than in the fact patterns alone.
The fact pattern in question 1999A_EVD, for example, is so
general that it would not, on its own, qualify for copyright
protection:
In a prosecution for murder, the judge has discretion toDENY which of the following requests made by theprosecution?
The extremely open ended nature of the question, however,
increases the degree of creativity involved in drafting the one
correct and three incorrect answer choices. Question #19 from
the 2003/2004 PMBE would not violate plaintiff’s copyright simply
because the fact pattern is materially similar, however it also
uses four substantively identical answer choices, and this
wholesale reproduction of a copyrighted question is not
permitted.
I find defendants’ claims of independent creation to be
wholly incredible. The “source binders” submitted are simply
post hoc efforts to identify sources that could, theoretically,
have been used. Even so, many of the “sources” simply provide
support for the legal principle being tested, lacking anything
4 While defendant’s proposed findings of fact suggests thatthere are 26 such questions, it identifies only 21. Six of thosequestions are not currently being challenged by plaintiff, and Iconclude that two others, 1588_EVD and 1886_EVD, are not similarenough to suggest copying.
16
related to the creative choices made by plaintiff in drafting MBE
questions. Notably, even when plaintiff was inspired by a case
or newspaper article, defendants’ “source binders” often omit
these clearly related materials. In addition, defendants did not
draft any new PMBE questions for 18 months after agreeing not to
take the MBE while this suit was pending. Defendants also failed
to provide a credible legitimate explanation for the striking
similarity in the wording of many PMBE and MBE questions.
I also reject defendants’ attempt to invoke laches and
estoppel. Their contention that plaintiff’s failure to object to
earlier PMBE questions that may have violated NCBE copyrights
holds no merit. The issue in this case is whether 113 specific
questions are infringing, and defendants could not reasonably
have taken plaintiff’s silence after publication of other
questions as general permission to engage in copyright
infringement. All but thirteen of the infringing questions were
first published by PMBR within the statutory limitations period,
creating a strong inference that plaintiff timely asserted its
claim.4 Seven of these thirteen were first published in 2001,
5 In 1978, NCBE sued PMBR for copyright infringement, andunfair competition and deceptive trade practices. Plaintiffdropped its copyright claim after concluding that the allegedinfringement had ceased, and lost on its other claim. NationalConference of Bar Examiners v. Multistate Legal Studies, Inc.,692 F.2d 478 (7th Cir. 1982). In 1990, NCBE sued PMBR in thisDistrict, alleging copyright infringement. The parties enteredinto a court-approved settlement later that year, and spent thenext five years squabbling over issues relating to thatagreement. See National Conference of Bar Examiners v.Multistate Legal Studies, Inc., Civil Action No. 90-1471 (E.D.Pa.)(Weiner, J.).
17
and thus may also have been challenged within the limitations
period. To the extent that challenged questions first appeared
prior to the limitations period, I find that plaintiffs did not
have actual knowledge of the infringement until October of 2003
and that they were not on constructive notice before that date.
Plaintiff’s earlier copyright infringement suits against
defendants5 did not give rise to a general duty to police all
PMBR materials. Cf. Kepner-Tregoe, Inc. v. Executive
Development, Inc., 79 F. Supp. 2d 474, 487-89 (D.N.J. 1999)
(imposing a duty to police when plaintiff had previously sued
defendant over the same copyright and had reason to believe that
the infringement had been continuous since that time).
Defendants also argue constructive notice based on reviews of
PMBR materials by an external consulting firm in 1996, 1998, and
2001. Only the 2001 review might potentially have discovered any
of the questions in-suit, and it did not reveal suspect
18
questions. Plaintiff hired a well-respected consulting firm to
do these reviews and reasonably relied on the results. I
conclude that these reviews in fact demonstrate a good-faith
effort on the part of plaintiffs to detect infringement.
Plaintiffs waited less than one year between discovering the
infringement and filing suit, well within permissible bounds.
Defendants infringed plaintiff’s copyright, and damages
must now be determined. NCBE has elected to pursue actual
damages plus PMBR’s profits, rather than statutory damages,
pursuant to 17 U.S.C. § 504(a). I find that the evidence
supports awarding both actual damages and apportionment of PMBR’s
revenues.
Actual damages may include both the direct expenses
resulting from the copyright infringement and the loss in the
fair market value of the copyright. I conclude that the July
2005 MBE had to be reprinted at a cost of $59,000 because
defendants’ copyright infringement had compromised the initial
version. There was no evidence of other expenses or of any loss
in the market for plaintiff’s copyrighted materials. I also
decline plaintiff’s invitation to award lost licensing fees,
which are appropriate when copyright infringement substitutes for
or interferes with a hypothetical contract between the parties.
See, e.g., Davis v. The Gap, Inc., 246 F.3d 152, 166-67 (2d Cir.
19
2001). Here, I find that there could not have been such a
contract: there is no fair market value for the infringed
questions, because to release current MBE questions is to
undermine the validity of the entire examination; there is also
no evidence to suggest that defendants would have licensed
released questions, because such questions do not provide the
crucial information defendants sought – previews of upcoming
tests. Since plaintiff lost no hypothetical royalties, I cannot
award actual damages in compensation. I can and will, however,
factor the uniquely proprietary nature of the infringed questions
into apportionment of defendants’ profits.
In order to recover lost profits, the owner of an
infringed copyright “is required to present proof only of the
infringer's gross revenue.” 17 U.S.C. § 504(b). It is the
infringer’s burden “to prove his or her deductible expenses and
the elements of profit attributable to factors other than the
copyrighted work.” Id. NCBE met its burden by proving the gross
revenues generated by PMBR’s 3-day course. Because defendants
did not introduce any evidence of expenses or other factors to
which profit should be attributed, I use gross revenues as the
measure of defendants’ profit. Relying on the average cost per
student, supplied by defendants’ expert, and the number of
students who took the course, I conclude that defendants’
6 While the average cost per student undoubtedly rose againin 2005, it was plaintiff’s burden to introduce such evidence, soI have not accounted for any increase in calculating 2005revenues.
2001: 19,503 students x $254.39 = $ 4,961,3682002: 24,853 students x $275.62 = $ 6,849,9842003: 25,150 students x $277.34 = $ 6,975,1012004: 26,497 students x $304.74 = $ 8,074,9692005: 29,032 students x $304.74 = $ 8,847,212Total $35,708,361
20
revenues from the 3-day course from July 2001 through 2005 were
$35,708,361.6 These revenues will be apportioned, and damages
awarded only to the extent that they are attributable to the
infringement. Doing so does not involve a mathematical formula,
but rather an assessment of the relative importance of the
infringing questions. See, e.g., Bruce v. Weekly World News,
Inc., 310 F.3d 25, 31-32 (1st Cir. 2002); Blackman v. Hustler
Magazine, Inc., 800 F.2d 1160, 1164-65 (D.C. Cir. 1986).
In determining how much of defendants’ revenues to
award, I take into account PMBR’s advertisements and excerpts
from Mr. Feinberg’s lectures. The heavy emphasis on similarity
between PMBE questions and MBE questions suggests that this is a
major selling-point for the company. It is not difficult to
understand why this might be the case, as PMBR’s potential
customers are almost all already enrolled in a general bar-review
course that includes MBE preparation. Some students may enroll
21
in PMBR simply to get extra practice or to access the particular
expertise of its instructors, but there can be no question that
the high quality of PMBR questions is a major attraction. While
this quality may be due in part to the ability of defendants to
generate realistic practice questions, the evidence in this case
reveals that it is largely a result of blatant copyright
infringement. On the other hand, students taking the 3-day
course also receive workbooks containing 2000 other practice
questions, substantive law outlines, and study aids. Still, the
PMBE is clearly the heart of the course. Because question
similarity is a major draw, and because infringing questions made
up close to 40% of the PMBE from 2003 through 2005 (though a
substantially lower percentage in 2001 and 2002), I conclude that
attributing one-third of defendants’ revenues to the infringing
questions is justified. Plaintiffs will be awarded $11,902,787.
I find that injunctive relief is also warranted, as
copyright liability has been established, and there is a real
threat of future infringement. 17 U.S.C. § 502. Defendants will
be enjoined from copying, duplicating, distributing, selling,
publishing, reproducing, renting, leasing, offering or otherwise
transferring or communicating in any manner, orally or in
written, printed, photographic or other form, including any
communication in any class or other presentation, any questions
22
obtained directly from any of NCBE’s copyrighted secure tests.
See Katzman, 793 F.2d at 544-545.
I also find that defendants violated the California
Business and Professions Code by intentionally reproducing MBE
questions, thereby subverting a licensing examination taken by
thousands of applicants seeking admission to the California Bar
each year. See Cal. Bus. & Prof. Code §§ 17200-209; 123-123.5.
This statute entitles plaintiff to restitution and injunctive
relief. I conclude that the damages already awarded provide full
restitution. Because of the likelihood of future violations,
defendants, their employees, and agents will be enjoined from
taking any Multistate Bar Examination for any purpose other than
to obtain bar admission in the jurisdiction in which the
examination is being given.
Guided by the factors articulated by our Court of
Appeals, I conclude that an award of reasonable attorney’s fees
and costs is justified. See Lowe v. Loud Records, 126 Fed. Appx.
545, 547 (3d Cir. 2005). Defendants’ willful and egregious
copyright infringement harmed the public as well as plaintiffs.
States have a compelling interest in regulating admission to the
bar both to maintain the integrity of the legal system and to
protect the safety of their citizens. By exposing its students
to questions likely to appear on the MBE, PMBR undermined the
23
integrity of the bar examination, possibly causing the admission
of unqualified applicants. That the victims of this harm are
impossible to identify and the injury impossible to quantify
underscores the need to deter would-be copyright infringers.
An Order follows.
IN THE UNITED STATES DISTRICT COURTFOR THE EASTERN DISTRICT OF PENNSYLVANIA
NATIONAL CONFERENCE OF :BAR EXAMINERS : CIVIL ACTION
:v. :
:MULTISTATE LEGAL STUDIES, INC., : NO. 04-03282-JFd/b/a PMBR, et al. :
ORDER
AND NOW, this 22nd day of August 2006, IT IS ORDERED
that:
1. JUDGMENT is ENTERED in favor of the plaintiff,
National Conference of Bar Examiners, and against the defendants,
Multistate Legal Studies, Inc., Robert Feinberg, and Dona
Zimmerman jointly and severally, in the sum of $11,961,787.
2. Defendants are enjoined from copying, duplicating,
distributing, selling, publishing, reproducing, renting, leasing,
offering or otherwise transferring or communicating in any
manner, orally or in written, printed, photographic or other
form, including any communication in any class or other
presentation, any questions obtained directly from any of NCBE’s
copyrighted secure tests.
3. Defendants, their employees, and agents are
enjoined from taking any Multistate Bar Examination for any
2
purpose other than to obtain bar admission in the jurisdiction in
which the examination is being given.
4. Plaintiff may submit an application for attorney’s
fees, costs, and prejudgment interest within 20 days, and
defendants may respond within 10 days thereafter.
BY THE COURT:
/s/ John P. Fullam John P. Fullam, Sr. J.